Enacy Mapakame in Bulawayo
Zimbabwe’s largest banking group by assets and deposits, CBZ Holdings Limited says repayment of loans by small to medium enterprises has been encouraging at 95 percent. This has prompted the financial services group to pour an additional $10 million facility this year for SME lending, in addition to the $10 million facility that was unveiled last year.
In a side interview at the second annual CBZ 2018 International SME Indaba in Bulawayo yesterday, acting group chief executive Peter Zimunya said there was a willingness from SMEs to meet their financial obligations, contrary to common belief the sector was reluctant to follow conventional financial services such as banking and loan repayments.
“The repayment is very good, we are talking upwards of 95 percent.
“They are small amounts, but they are willing to pay back, and that is a good starting point if they are willing to pay whatever challenges they may face, we can work together and see how we can assist each other” he said.
Last year, at the inaugural SME Indaba, CBZ unveiled a $10 million facility for the sector.
Of this, over $7 million has been disbursed to the budding enterprises with Mr Zimunya saying an additional $10 million facility has been budgeted this year to capacitate the sector.
This also comes as CBZ registered a 28 percent growth in SME business, a year after launching the Indaba, which seeks to grow the sector through linkages.
Overall, the SME sector takes about 4 percent of the banking group’s total book with plans underway to increase it to 20 percent, as more support will be availed to potentially viable businesses. The second Indaba, which will run to this Friday has drawn delegates from India, Malawi, Namibia and South Africa with interests in pharmaceuticals, fertiliser manufacturing as well as the health sector.
South African delegate, Lebo Kekana said the Indaba was an opportunity for SMEs from across the region to share information, create business linkages and partnerships for growth.
“We can work together to ensure the industrialisation of the Sub-Saharan region, which will be spearheaded by SMEs in our region,” he said.
This year’s Indaba is running under the theme “Enhancing SME growth through smart partnerships,” and seeks to provide a platform for strengthening the sector’s contribution towards job creation, poverty alleviation, social and economic development as well as overall contribution to gross domestic product.
Following success of the first Indaba, more business is expected this year with CBZ pledging continual support for the sector.
“We have seen SMEs growing, our portfolio for the sector has also grown and we want to support the entire value chain, starting from inputs to the off takers,” said Mr Zimunya.